Everyone knows that good employees are important for a thriving business. That’s why there has been so much emphasis on keeping employees happy. When your employees are feeling not only satisfied, but also valued, they will be more likely to keep your clients satisfied too. Your business will be more likely to thrive and grow. Of course, this works in the opposite direction as well. When your staff is frustrated and angry, their actions can drive away your customers and clients. If you are looking to sell your business for maximum revenues, it is a good idea to also maximize employee satisfaction levels.
Research from Oxford University found a link between happiness and productivity. According to their study, workers are 13% more productive when they are happy. It goes without saying that employees will be more likely to feel satisfied when they feel that their salary and benefits are fair for the work they do. If they are resentful about the compensation they are receiving for their work, this will ultimately impact their performance.
When you think about some of the most successful companies, you realize that many of them invest substantially in supporting their employees to cultivate higher levels of employee satisfaction. For example, Google is well-known for offering a wide range of perks ranging from parental leave and paid time off to free lunches and fitness facilities.
When it is feasible for employees to work remotely, many employers are finding that it makes sense to offer them this possibility. Not only will it help staff members to manage childcare, but also it can end lengthy and stressful commutes to work that could result in stress and anxiety.
Research in the journal Frontiers in Psychology showed helpful interventions that are proven to increase employee happiness levels. These included training in resiliency, mindfulness, and cognitive-behavioral techniques.
When you exhibit good leadership and act as a positive role model, your employees will likely follow suit. Employees should be acknowledged and rewarded for a job well done. In some cases, this may be a financial bonus, but in other cases it could simply be patting that employee on the back. Cultivating a positive company culture will prove to boost overall morale. This will increase success for your entire company.
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Are you selling a business that involves a lease? If so, this will be a factor that has significance to a buyer when you go to complete your deal. If your business relies heavily on its location and you don’t own property, then you’ll find the lease will be quite an important consideration for your buyer. By the same token, if you’re buying a business that involves a lease, you’ll want to carefully examine this document and consider how it might impact you and your business. Let’s take a look at some important clauses and terms you’ll want to be looking for.
What are the terms for transfer of the lease? This is something you’ll want to know before signing on the dotted line if you think you’ll be selling at some point in the near future.
How long is your lease? If your buyer can confirm that there are many more years on your lease, he or she will find that to be an advantage.
In the case of a business owner with a new endeavor, a shorter lease may actually be an advantage. That way the owner can get out of the lease if the business is not successful.
If you’re planning on a lease in a shopping center, it’s essential to get in writing that the center will not accept other tenants that do what your business does. Otherwise, you’ll be constantly faced with competing with a similar business.
It’s also important to look for clauses that address what happens in the case of an adverse event. For example, if the property was destroyed by a fire, who will pay in the interim?
There are other practical considerations to consider in leases that many business owners tend to overlook. For example, how are real estate taxes covered? Will you be charged a fee to cover maintenance of the property and, if so, what is it? Is someone in particular responsible for necessary repairs and who will pay for those?
It goes without saying that you’ll also want to check out clauses impacting rent changes. Otherwise, you may face unexpected rent increases that negatively impact your business.
If you are a new business owner, a landlord may ask you to personally guarantee the rent. This would be quite a different lease from one that accepts a well-established corporation as a tenant.
As you can see, there is much more involved in a lease than just the amount of the rent. Be sure to read your lease carefully and ask questions. A Business Broker or M&A Advisor can assist you with lease terms when you are buying a business.
You’ve worked extremely hard to build a successful construction business, and you’re reaping the rewards of that work. However, you’re ready to move on to something else, such as retirement or another business.
Before you close your company, think about selling it. Then, you can keep the business going without having to run it yourself.
Read on to learn more.
Prepare for Retirement
One of the best reasons to sell your construction business is to help prepare for your retirement. As you get close to retirement age, you may want to stop working, but your business might be doing too well to close.
You can sell your business to get some extra cash, which can help top off your retirement savings. Then, you may have enough money to retire comfortably, so you can maintain your lifestyle.
Retirement is a big decision, and it takes a lot of planning, especially when you own a business. Selling your construction company can give you a smooth path from full-time business owner to retiree.
Cut Back on Work
Maybe you aren’t quite ready to retire, but you don’t want to work as much. Running a small business takes a lot of time, and you may want to slowly cut back on your working hours.
Selling your business can be a good way to help you reduce your schedule. You can move to an employee role either for the new owner or for another company.
That way, you’ll be able to show up to work and do your work for those eight hours. When your shift is over, you can go home and not worry about marketing a business or getting new clients.
Mitigate Your Risk
Owning a construction business or any other company can be risky. If you’re ready to stop dealing with a ton of risk, you may decide to sell your company to someone who can take on the risks.
You can sell the business for a set price, and you’ll be able to get that money in your pocket now. While your total gains may be less than if you kept the business, you won’t have to worry about losing money.
Whether you’re looking to retire, buy a house, or do something else, it helps to have financial stability. Even the most successful small business can have ups and downs, so you may not always make money.
You’ve Made Money
Perhaps your goal for starting a construction business was to make some money and get out. If you’ve made as much money as you wanted, it’s a good time to sell.
This is especially true if your business is especially profitable right now. You may not want to wait and risk losing money and then trying to sell the business when buying it wouldn’t be as desirable.
If you sell your business when it’s doing well, you may get more interest from buyers. The buyers may also be more serious about taking over your business so that it can continue to thrive past your involvement.
If you’ve run your construction business for a while, there’s a good chance you may not be as passionate about it anymore. Interests can change over your life, and that’s okay.
You may find it harder to run a business that you don’t care about. Selling the business can be a good way to give it to someone who does want to run it and make it a success.
Plus, you can use the money you receive to start a different business that interests you more. Then, you’ll look forward to starting and growing a business, and you may be able to make that new business successful.
Desire to Relocate
Another good reason to sell your small business is if you want to move. You can run a business from afar, but it may not be as easy as being in town where you can meet clients in person.
Even if you want to stay in the area, maybe you want to move to the other side of town. That move may then require a longer commute, and you might not want to deal with that.
If you don’t want to move your main office with you, it can be a good idea to sell the business. Then, someone else can keep up with the current operations and projects.
Problems Between Owners
When you have co-owners, you may have to make compromises regarding how to run the business. But if you and the other owners disagree on matters that can significantly affect the business, it may be better for everyone to get out.
Then, you can sell the business to one person or to a team of people who have the same vision. That way, the owners will be able to focus on growing the business instead of fighting over how to do that.
Of course, you can also choose to sell your portion of the business if another owner wants to keep it. Then, you can avoid the stress of running a business with someone else.
Help Employees Keep Their Jobs
Before you simply close a business, consider your employees. Selling the business can be a good way to let those employees keep their jobs as long as you include an employment clause in the sale contract.
You can make sure any potential buyer is comfortable working with the current employees. Then, you won’t have to leave people in the dust looking for new jobs.
Instead, they can keep the business running during and after the sale. That way, you and your successor can enjoy a bit less stress as you transfer ownership.
Will You Sell Your Construction Business?
Selling a construction business is a big deal, so you shouldn’t take the decision lightly. However, consider how selling can benefit you, your employees, and the community.
You can use the money to prepare for retirement or open a new business. Then, you’ll be able to enjoy your life and get rid of any potential stress of running a construction company.
Are you ready to sell your business? Register as a seller to work with business brokers today.Read More
If you’re selling your business, at some point you’ll likely be presented with a term sheet. As the name suggests, this document will include the “terms” of the deal including the basic economic terms and conditions of a prospective acquisition. It is a list of conditions to be met if the sale successfully takes place, yet it is not legally binding.
What is the Difference Between a Term Sheet and the LOI?
Both a term sheet and letter of intent (LOI) will include stipulations and lists for a buyer and seller to agree upon. The major difference is that the term sheet doesn’t require a signature, while the letter of intent does. In many cases, buyers are hesitant to sign before the due diligence stage. In this situation, you may find that the term sheet will precede the LOI.
How Lengthy are Term Sheets?
There is no standard model or form to a term sheet. Therefore, it may be as short as one page, or it could even be five or more pages. But no matter how many pages it may be, it should explain what is being purchased and a stated price. In some cases, the information in a basic term sheet will lead to a formal letter of intent.
What Components Should be Included?
In addition to the price and terms, a term sheet can include other considerations relating to the purchase of the business. For example, it can include employment agreements or non-compete clauses. They can also include conditions to be met upon closing. Often the term sheet will detail plans for the buyer to conduct due diligence and gain additional information. You can expect to find everything from warranties and lists of what is included in the sale to exclusivity clauses within term sheets.
One aspect of the term sheet that should not be overlooked is the method of payment. Typically, the payment sections are far more complex than just “cash at close.” Instead, they will describe a combination of elements including cash at closing, but also other forms of payments. In some situations, they will include details regarding a loan from the seller.
The term sheet is quite beneficial as it can expedite the sales process and prevent serious misunderstandings. As a result, this non-legally binding document can initiate a smooth beginning to a successful deal.
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